Four toy companies, including giants Hasbro and Mattel, agreed
to pay nearly $1 million in fines for allowing vendors to track
children's Internet habits. Photo by John Angelillo/UPI

| License Photo

Four toy
companies, including giants Hasbro and Mattel, agreed to pay nearly $1
million in fines for allowing third-party vendors to track children's
internet habits without parental approval.

Viacom and JumpStart games also agreed to pay
fines totaling $835,000 in the two-year "Operation Child Tracker" probe
that found violations of the federal Children's Online Privacy
Protection Act. New York Attorney General Eric Schneiderman said the
companies also agreed to put in place new procedures to protect children
from improper tracking in the future. This includes regular electronic
scans to monitor for third-party tracking technologies and adopting
procedures that will vet third-party data collection practices.

Viacom, Mattel and JumpStart also agreed to
give regular reports to the office regarding the results of their scans.
Together, the four companies are behind some of the biggest toy brands,
including My Little Pony, SpongeBob Squarepants, American Girl and Barbie.

"Federal law demands that children are
off-limits to the prying eyes of advertisers," Schneiderman said in a
written statement. "Operation Child Tracker revealed that some of our
nation's biggest companies failed to protect kids' privacy and shield
them from illegal online tracking. My office remains committed to
protecting children online and will continue our investigation to hold
accountable those who violate the law by tracking children."

Schneiderman said the probe, the first of its
kind in the United States, relates to the use of online behavioral
advertisements, which use collected information that includes browsing
history and demographics to target ads personalized to users. The 1998
law passed by Congress is intended to protect children from the use of
behavioral advertisements.

Viacom and Mattel will pay penalties of
$500,000 and $250,000 respectively. JumpStart, maker of Neopets, will
pay $85,000. Hasbro, which participated in a U.S. Federal Trade Commission-approved "safe harbor" program but failed to disclose details of a re-marketing program on its Nerf website, will not be fined.

"We will be more closely vetting and
monitoring companies that work on our behalf," Duffy said in a
statement. "We are rolling out a new, stricter online privacy protection
policy for our partners, and enacting new protocols and technology to
scan our digital properties for any cookies, widgets or other
applications that may violate our policy."